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Monday, April 25, 2011

A century long trend in higher education is topping. The decline should last for decades. Those who follow our work knows that social mood (mass psychology) drives social action and has structure and form. Social mood also rules academic achievement.

The "Education debt bubble" is now bigger then the "Credit card debt bubble" in the United States. Families (and their kids) have become indebted beyond their means in order to finance their kids higher education.

Students, families, professors, teachers, lending institutions and others that participated in the madness are all at the crest of the abyss, will this end like the housing bubble? How much pain lies head when this trend is unraveling the coming decades ? Will they all be victims ?

In Peter Thiel, the founder of PayPal, we have found someone who shares our view. In an interview in TechCrunch: "Thiel argues that the bubble that has taken the place of housing is the higher education bubble. “A true bubble is when something is overvalued and intensely believed,” he says. “Education may be the only thing people still believe in in the United States. To question education is really dangerous. It is the absolute taboo. It’s like telling the world there’s no Santa Claus.”

Like the housing bubble, the education bubble is about security and insurance against the future. Both whisper a seductive promise into the ears of worried Americans: Do this and you will be safe. The excesses of both were always excused by a core national belief that no matter what happens in the world, these were the best investments you could make. Housing prices would always go up, and you will always make more money if you are college educated."

Thiel thinks there’s been a sea-change in the last three years, as debt has mounted and the economy has faltered. Parents see kids moving back home after college and they’re thinking, ‘Something is not working. This was not part of the deal.’

But Thiel’s issues with education run even deeper. He thinks it’s fundamentally wrong for a society to pin people’s best hope for a better life on something that is by definition exclusionary.

The above is an extract from an interview in TechCrunch with Peter Thiel. See the whole interview here.

If you want to learn more about the deteriorating public schools with escalating violence and more and more pacified students, an environment where creativity and being an artist are suppressed and neglected, see the stories filed at this blog under the label "Social Trends".